On the road toward green: Part II: in the conclusion of his journey, the author provides details on the dynamic growth of the green segment and how companies are capitalizing on the trend

Household & Personal Products Industry, April, 2008 by Lambros Kromidas

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LAST MONTH, I detailed some, but not all, of the elements that are necessary to develop greener cosmetic products. This month, I'd like to give you some statistics on this dynamic segment.

Organic Monitor (1) projected that sales of natural and organic cosmetics would surpass the I billion euro mark in 2006. It also indicated that the German and French markets are the fastest growing in Europe. In Germany, natural cosmetics comprised 4% of total cosmetic sales and were projected to reach 10% by 2012. What was really amazing was that Organic Monitor estimated more than 400 European companies were involved in producing natural cosmetics albeit most are small producers with Weleda being the leading producer. A year ago, the Natural Marketing Institute stated that U.S. consumers spent $4.9 billion on natural and or organic personal care products in 2005--up 22% up from 2004. Furthermore, NMI predicted spending could increase to nearly $11 billion by 2009.

Last August, Packaged Facts reported that sales of natural and organic personal care products rose from $2 billion in 2002 to $6.1 billion in 2006. (2) This represented a sales jump of 11% over the previous year. Packaged Facts also projected that sales growth will reach $10.2 billion by 2012.

Clorox's own research recently found that 53% of consumers would buy more eco-friendly products in 2008. While 47% are willing to even pay up to 25% more for them. (3)

Who are these green consumers? According to a WSL Strategic Retail report, the greenest consumers are also the oldest. Eighty five percent of those over 55 try to conserve energy or use natural products vs. 65% of those under 35. This is supported by a November 2007 Organic Monitor survey that showed that the typical UK consumer who purchases natural and/or organic cosmetic products is middle-aged and female. (4)

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Green at Work

Now that I have clarified the meaning of green, let's see how this global phenomenon is applied to just about all products and services. Nearly every industry is promoting its "green-ness" these days or trying to capitalize on it. Of course the reason why cosmetic suppliers are offering green ingredients is because the cosmetic industry is demanding them.

I already mentioned Nature's Gate and Origins but there are many other examples worldwide. Eco-Sensual Balm, a lip product made by Peacekeeper, is made of natural ingredients and is 73% organic. Moreover, all its profits after taxes fund human rights issues. If nothing else, addressing human rights issues makes this a green product because as detailed last month, it addresses respect for living things.

As a result of this green movement, we have green tracking or monitoring sites. For example, Organic Monitor is a business research and consulting company that specializes in the global organic and related product industries. It has been tracking the natural cosmetic market since 2004.

Fashion, too, is going green. (5) Designers are using fabrics made from organic cotton or fabrics partly derived from coconuts and bamboo. Packaging may be from recycled paper. Shirts for example, may no longer be wrapped in tissue paper. Hangtags may be made from recycled paper. Footwear such as ecosneaks, are made from recycled car tires, recycled plastics, and organic cotton.

Media Promotes Green

Media companies are taking advantage of the green movement. There are magazines devoted to green such as TheGreenGuide available from National Geographic. Acquired in the last year, the guide is billed as a source for today's conscious consumers who are striving for a healthy and greener lifestyle. Our industry may become intimately involved with this magazine as special interest groups unfriendly to our industry use it as a tool to reach our consumers. Last year, Alan Weisman published a book entitled The World Without Us. (6) The movie industry is also capitalizing on green. Al Gore's An Inconvenient Truth is just one example. Another green movie Sony Pictures' Who Killed the Electric Car?

There are international and national organizations devoted to green issues. One of them is Green Cross International. Its purpose is to create a sustainable future by cultivating harmonious relationships between humans and the environment. Green Cross is linked to 21 national organizations. The U.S. group is Global Green USA.

Meanwhile, the building industry is profiting from green buildings. The U.S. Green Building Council is a non-profit organization that promotes buildings that are environmentally responsible, profitable and healthy places to live and work. Of course it goes without saying that the use of energy or the energy sector is on the road to green as well. The U.S. Environmental Protection Agency's Green Power Partnership encourages organizations to buy green power as a way to reduce the environmental impact associated with conventional electricity use. It preaches the use of renewable energy resources such as solar, wind, geothermal, biogas, and low-impact hydro-generated energy. Aveda, a subsidiary of Estee Lauder, is a participating company. It has adopted wind energy in its Minnesota based manufacturing facility. (7)